Black Monday: The downfall in the global markets substantiates the fear of experts who believe that the trade war could cause a global recession.
Black Monday: Indian benchmark indices went into a tailspin in opening trade on Monday amid weak global cues. While both the Sensex and Nifty crashed over 5 per cent, Asian shares too nosedived with Japan’s Nekkei diving nearly 8 per cent after the meltdown Friday on Wall Street over US President Donald Trump’s tariff hikes and the backlash from Beijing.
Why Black Monday Is Trending Today?
This comes days after Jim Cramer, an American television personality and market commentator, predicted that the tariff war could lead to a market crash in the United States reminiscent of the infamous 1987 ‘Black Monday’. He warned of a similar ‘bloodbath’ on April 7.
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“We will not have to wait too long to know. We will know it by Monday,” he said.
Experts Fear Global Recession
The downfall in the global markets substantiates the fear of experts who believe that the trade war could cause a global recession. If it does, stock prices may need to come down even more than they have already.
What Happened On 1987’s Black Monday
On October 19, 1987, markets across the world crashed. The US Dow Jones Industrial Average had tanked 22.6 per cent – its largest one-day percentage loss in its history. The S&P witnessed an even steeper decline and fell 30 per cent on the same day.
This triggered a global stock market downturn, and the turmoil continued for a month. By early November 1987, some of the major stock market indices had eroded 20 per cent of their value.
Rs 19.50 Lakh Crore Wiped Out
The market crash has wiped out investors money by over Rs 19 lakh crore. The market capitalisation of all listed companies on the BSE declined by Rs 19.44 lakh crore to Rs 383.95 lakh crore.
The market capitalisation of all the BSE-listed companies on Friday (April 4) stood at 40,409,600.62 crore.
Rs 29 Lakh Crore Lost Since Liberation Day
Sensex has lost 4,000 pts since US President Donald Trump announced ‘reciprocal’ tariffs on April 2 – which has been termed as ‘Liberation Day’.
Investor wealth slipped by Rs 29 lakh crore to Rs 383.95 lakh crore today against Rs 412.98 lakh crore on that day.
Rupee Drops 19 paise
The rupee, too, is facing the heat of the global trade war triggered by the US reciprocal tariff and China’s retaliatory move. It declined 19 paise to 85.63 against the US dollar in early trade on Monday,
Sensex, Nifty Today
The 30-share BSE benchmark Sensex crashed 3,939.68 points or 5.22 per cent to 71,425.01 in early trade. The NSE Nifty tumbled 1,160.8 points or 5.06 per cent to 21,743.65.
Asian Markets Today
Tokyo’s Nikkei 225 index dipped nearly 8per cent shortly after the market opened. By midday, it was down 6per cent at 31,758.28.
Chinese markets often don’t follow global trends, but they also tumbled. Hong Kong’s Hang Seng dropped 9.4 per cent to 20,703.30, while the Shanghai Composite index lost 6.2 per cent to 3,134.98.
South Korea’s Kospi lost 4.1 per cent to 2,363.82, while Australia’s S&P/ASX 200 lost 3.8 per cent to 7,377.70, recovering from a loss of more than 6 per cent.
